EDI 101. Your Basic Course in Electronic Data Interchange

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1 EDI 101 Your Basic Course in Electronic Data Interchange Direct EDI, Inc., 2009

2 IRECT EDI, INCI DIRECT NC. Direct EDI, Inc. is an e commerce solution provider specializing in providing web based EDI solutions to companies worldwide. They are unique do to their personal and custom approach to improving your business with EDI services. Direct EDI, Inc. understands that one size does not fit all you aren t generic and don t want generic solutions. You require a solution that fits your individual needs. Direct EDI, Inc. has developed a variety of products and services that can be implemented separately or integrated to make truly unique, personally molded solutions. Products include: Web EDI System Compliance Testing System Communication Methods EDI 2.0 UHT 2.0 Services include: Web EDI Services Connectivity Services Compliance Testing Services Hosted EDI Translation Integration Trading Partner Enablement Vendor Community Enablement Enterprise Services Pay Per Use EDI Solutions Include: Web EDI Solutions Supply Chain EDI Solutions Outsourced EDI Managed Services Retailer Solutions: 100% Vendor Enablement Vendor Community EDI Enablement For more information on their Vendor Community EDI Enablement Solution or on any of their other offerings, please do not hesitate to contact Direct EDI, Inc. via phone or e mail. Direct EDI, Inc Rio San Diego Drive, Suite 505 San Diego, CA Phone: (858) xt. 1 Fax: (858) E Mail: [email protected] Direct EDI, Inc.,

3 INTRODUCTIONNTRODUCTION Incorporating an Electronic Data Interchange (EDI) solution you will run you company or department more efficiently, increasing your growth rate and success. Direct EDI, Inc. s ambition is to help you meet or exceed your business goals with EDI. It s always a good idea to consult with experts in the field of EDI implementation to train staff and transfer knowledge into your organization, especially if there is not sufficient EDI expertise within your company. The EDI process is exceptionally stable and easy to maintain once it is established in a wellcontrolled and documented environment. Connect To Your World of Suppliers with EDI! You are not expected to be an EDI expert. That is why we would like to share some general information with you to take the mystery out of EDI. We understand that as you research different EDI options, you will have specific questions. Please do not hesitate to contact us. EDI is our passion and we will help you make an educated decision. Now, let us start with the basics. Direct EDI, Inc.,

4 Electronic Data Interchange (EDI) by itself is nothing more than the simple exchange of electronic information. EDI is intended to improve accuracy, decrease the time of the business document flow and replace paper and has become the basis for all electronic commerce. EDI is most valuable when it comes to replacing the repetitive, manual tasks required to support a business relations. EDI removes the need for these through process automation and eliminating the paperwork involved in day to day business. This feature is becoming more important as the go green movement becomes more prevalent in the business community. EDI boosts accuracy by eliminating the re keying of paper based data. Additionally, through the electronic verification of each business document ensuring it meets the transaction requirements, data quality is enhanced. Customer/supplier partnerships are solidified by reducing supply chain costs associated with manual processing, making them more agile and competitive. WHY EDI? The World of Business Becomes Digital with EDI! Direct EDI, Inc.,

5 In EDI, information is organized according to a specific format or set of requirements to which both parties have agreed. For the most part, the information contained in an EDI transaction set is the same as on a conventionally printed document. The EDI standards in the United States are set by the ACS x12 committee of ANSI (American National Standards Institute). What are the EDI Standards? HOWOW DOES EDI WORK? OES EDI W In order to successfully process electronic transactions, both parties involved need a single common format. Both sides of the transaction must agree and implement the chosen standard precisely. Electronically transmitting documents in a standard format increases the speed, accuracy, dependability and timeliness of data. This is an example of how EDI information may be organized for the exchange of information for an 850 Purchase Order document. This example has been broken down from left to theright. On the left, the document type 850 is shown. In the transaction type, it shows all EDI transactions for that form and N1 has been highlighted. In the Segments section, it shows all information needed for the N1 transaction type. The elements show the specific data (Free Form Name) and parameters that are required in order for that data to be successfully processed. Each transaction and segment will be broken down like the N1 example, showing exactly which type of data is needed and the specific data necessary to fulfill that requirement. This avoids confusion on remaining compliant with Trading Partner EDI requirements. Direct EDI, Inc.,

6 HOWOW DOES EDI TRANSMITRANSMIT THE DATA? OES EDI T EDI information is transmitted reliably and securely between Trading Partners through three primary channels AS2, VANS and FTP. Each one of these connections can be used for a successful EDI transaction, but it is up to the Trading Partner Requirements on which EDI communication method will be utilized. Unfortunately, various trading partners may have different communication method preferences. VAN The Value Added Network (VAN) is a private and secure internet connection. Often, VANs are interconnected with one another making data transmission possible across the established networks. AS2 AS2, or Applicability Statement 2, is a specification on how to transport data securely and reliably over the internet. Security is achieved through the utilization of digital certifications and encryption. The set up of AS2 connections are often complex and require a collaborative effort between the two parties who are establishing the connection to ensure that all required certificates are up to date and that the Trading Partner requirements are maintained for the AS2 connection. Additionally, AS2 involves the use of in house equipment that may need to have a Drummond Certification. FTP File Transfer Protocol or FTP allows to the transference of large quantities of EDI data at one time. This is a simple scalable solution that can be made secure, although it may not be as secure as either VAN or AS2 Connections. Value Added Network (VAN) Applicability Statement 2 AS2 Direct EDI, Inc. File Transfer Protocol FTP Your EDI Connection An increasing number of companies are integrating EDI functionality with their ERP solutions, such as Oracle, NetSuite or SAP, to automatically extract the needed data for each business transaction with hands free processing. Any one of the discussed EDI transaction methods can be utilized for these types of integration, depending on the EDI requirements of the Trading Partners. Direct EDI, Inc.,

7 WHAT ARE THEHE STEPSTEPS IN THE There are four primary steps in an EDI process. These are: EDI PROCESS? THE EDI P Direct EDI, Inc.,

8 ABOUTBOUT DIRECT IRECT EDI, INCI NC. Direct EDI, Inc. was founded in 2002 and is an e commerce solution provider. They specialize in the integration of all business sizes small to large into dynamic and successful supply chain networks. Whether you require a Web based EDI system or a comprehensive integrated solution, Direct EDI, Inc. can assist you in satisfying your EDI compliance requirements and streamline your business practices. Web Solutions Direct EDI, Inc. specializes in providing Web EDI Solutions for all sized companies. This system guarantees Trading Partner compliance and features a user friendly interface, flexible integration capability and superior customer service. Direct EDI, Inc. s Web EDI solutions truly give companies the freedom to move to an EDI system with no front end costs of software or pricey installations. What could be better? Supply Chain Solutions Gain supply chain competitiveness and velocity while reducing the costs of inefficient business processes! Through a unique blending of services including compliance testing and enablement practices, we help to streamline your supply chain connectivity through standardized EDI practices! For more information, please visit Direct EDI, Inc. at or call (858) xt. 1. Direct EDI, Inc.,